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Tobacco Firms Step Up Efforts To Defeat Cigarette Tax Hike Measure

Friday, April 27, 2012

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Tobacco Firms Step Up Efforts To Defeat Cigarette Tax Hike Measure

Friday, April 27, 2012

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Tobacco companies -- including Philip Morris and R.J. Reynolds -- are spending tens of millions of dollars to try to defeat Proposition 29, a June ballot initiative that would increase the state's tobacco sales tax by $1 per pack, the San Jose Mercury News reports (Harmon, San Jose Mercury News, 4/26).

The current tobacco tax is 87 cents per pack. The state allocates 50 cents of that amount for First 5 early childhood health and education programs.

Ballot Initiative Details

Prop. 29 was written by the American Cancer Society, the American Heart Association and the American Lung Association.

Supporters of the initiative say the tax increase would generate about $600 million annually to fund research on smoking-related conditions such as cancer, heart disease and stroke.

They note that it also would produce $179 million each year for tobacco cessation, prevention and enforcement initiatives (California Healthline, 2/2).

Efforts To Defeat Prop. 29

So far, tobacco companies have spent $21 million -- including $8.9 million in the past month alone -- on efforts to defeat Prop. 29. The tobacco industry's spending could outpace the $66 million it spent in 2006 to defeat another tobacco tax hike initiative, according to the Mercury News.

A coalition opposed to the tax hike proposal, called Californians Against Out-of-Control Taxes and Spending, has begun airing television and radio advertisements that focus on a provision of the proposal that would let out-of-state groups bid on research dollars.

In the ads, a Sacramento-area physician warns that the ballot measure would create "a huge new research bureaucracy with no accountability run by political appointees who can spend our tax dollars out of state."

Support for the Measure

Meanwhile, the health care groups backing the ballot measure have raised $2.5 million in support of the proposal.

They say the real motive behind the tobacco industry's ads is to preserve the tobacco market in California.

Health care advocates say that nearly all of the research funding would be spent in the state but that they wanted to keep the research bidding process open to avoid accusations of cronyism.

Outlook for Prop. 29

Tracy Westen -- CEO of the Center for Governmental Studies in Los Angeles -- said that heavy spending on efforts to encourage voters to reject a ballot measure tends to be effective because voters already are inclined to vote no on ballot initiatives. However, he said it is more challenging to defeat initiatives when voters are knowledgeable about the issues.

Westen said, "Generally, Californians tend to oppose smoking and support restrictions, so the cigarette industry will have to spend their advertising budget talking about other issues."

California voters have not approved a tobacco tax hike in 14 years, the Mercury News reports.

However, a survey last month by the Public Policy Institute of California found that 67% of likely voters support the tobacco tax initiative (San Jose Mercury News, 4/26).

Editorials, Opinion Pieces

Headlines and links to editorials and opinion pieces on the tobacco tax initiative are provided below.

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Well, you know, people will always go around such rules. There are websites out there that ship free anywhere in the world and are all tax-exempt. Here is one taxfreecigs.net

April 29, 2012 at 7:54 AM

Stephen Hansen

We are the only state to not raise tobacco taxes this century!
This is a great initiative--VOTE YES!!

April 27, 2012 at 11:00 AM

Ron Werner

I find these arguments interesting. If the supporters of the tax were truly interested in peoples health, the tax increase should not be $1.00 but $1,000. per pack. That would make smoking unaffordable to most people. But that would also not create much revenue to the bills sponsors. So are they really interested in people stopping smoking or raising revenue?

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